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  • Writer's pictureTimothy Laku

How can we address the unemployment conundrum affecting the Youth in Africa?

Young people on the continent are the most adversely affected by unemployment. On XFM this week, we continued with our series on Digital for Development.

We looked at how a thriving e-commerce ecosystem can create decent work for the Youth and drive economic growth for countries in Africa.

Maritza, Timothy, and DJ Cisse debating the Youth unemployment challenge in Africa

Africa's population is about 1.2 billion people. More than 63% of Africa’s overall population is below the age of 25. In Sub-Saharan Africa, 3 in 5 of the total unemployed are youth and on average 72% of the youth population live with less than $2 a day.

Unemployment poses numerous social, economic, and political risk across the continent. To mitigate these risks, different governments have pursued different multi-stakeholder strategies, formulated policies, and encouraged Foreign Direct Investments.

No one can claim to possess a silver bullet that will address the unemployment challenge. No one solution is going to eradicate this issue. Industrialization, which most policy makers are advocating for, may be part of the solution but certainly not the answer.

Governments are yet to give some serious consideration to the role digital platforms can play, particularly e-commerce, as one of the tools to address the unemployment conundrum.

Governments across the continent need to start asking the right questions.

Can e-commerce be a powerful driver of economic growth, inclusive trade, and job-creation in developing nations? Can a thriving e-commerce ecosystem create decent work for the Youth and drive economic growth for countries in Africa?

So what is e-commerce?

According to OECD, e-commerce refers to purchases and sales conducted over computer networks, using multiple formats and devices, including the use of computers, tablets and mobile phones.

Opportunity #1

e-commerce can contribute to significantly increasing the exports of developing countries, in particular doubling the share of global exports by developing countries by 2020

Opportunity #2

e-commerce can become a driver of inclusive growth and sustainable development by empowering women as entrepreneurs and traders

Opportunity #3

e-commerce can support productive activities, create decent jobs, entrepreneurship, creativity and innovation

Opportunity #4

e-commerce can encourage the formalization and growth of micro-sized, small-sized and medium-sized enterprises, including through access to ICT-enabled financial services

Opportunity #5

e-commerce can help micro-sized, small-sized and medium-sized enterprises gain access to financial services online & mobile payments as they integrate into value chains and access bigger markets

What's needed for e-commerce to thrive?

For e-commerce to thrive, leaders need to institute a countrywide access to fast, stable internet, and at affordable prices. Internet in developing economies tend to be more costly than in more advanced economies, stifling innovation. Supporting systems and enabling policies have to be in place:

  • Financial systems need to secure investments and payments

  • Regulatory and legal systems have to be in place to protect workers and consumers.

  • Policy systems need to enable and reward innovation

  • Economic systems need to allow raw materials, components and finished goods to flow across borders

In Closing

To raise a country’s e-commerce readiness, policy areas need to address holistically the development of affordable infrastructure, logistics, trade, regulation, payment, skills development, and funding of e-commerce innovation.

Instead of focusing on the costs and risks brought about by the rapid uptake of e-commerce, governments should start looking at the opportunities to drive economic growth and job creation.

Tune in to Digital Thursday on XFM 94.8 from 9 am to 10 am

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